Northern Ireland economy forecast to grow by 1.0 per cent in 2018
Northern Ireland experienced sluggish growth in 2017, with the economy estimated to have grown by just 1.1 per cent. Looking into the year ahead, growth is expected to remain subdued with a marginal fall in the growth rate to 1.0 per cent forecast in 2018.
Inflation is projected to fall gradually over the year ahead, but it is likely to remain above the Bank of England’s 2 per cent target and average 2.6 per cent over 2018. Household spending power is likely to remain under pressure as increases in the rate of nominal wage growth are unlikely to be enough to push real wage growth well into positive territory.
With Brexit-related uncertainty also likely to persist, some firms are still expected to postpone capital spending until the UK’s future trading relationship with the EU becomes clearer.
The number of employee jobs in 2017 is estimated to have grown by 1.4 per cent. However, a slight slowdown in job creation is projected in the fourth quarter of 2017 compared to the previous two quarters. This slowdown in jobs growth is forecast to continue into 2018, ultimately leading to a decline in employment in the final quarter of the year, with growth averaging just 0.3 per cent throughout the whole year.